The average Michigan worker spends about 19% of their family income on child care each month (Marx, 2019) and a significant amount on out-of-pocket medical costs for their families. If your family has child/elder care and/or health-related costs, how would you like to save an average of 30% on these common household expenses? Flexible spending accounts (FSA) allow you to use pre-tax dollars to pay for eligible expenses, offering you a sound strategy to save money on items or services you use every day.
MSU is happy to offer benefits-eligible employees the option to enroll in two types of FSAs: Dependent Care FSA and/or Health Care FSA. You will manage your FSA directly with WageWorks, MSU’s plan administrator.
What’s the Difference Between the Dependent Care FSA and Health Care FSA?
Good question! Make sure you know the eligible expenses each FSA plan allows you to use your pre-tax money on before you enroll in one or both plans.
When you enroll in the FSA, you’ll decide how much money you’d like to contribute to it. This money will be deducted from your paycheck (pre-tax) and divided over each pay period throughout the plan year. You can read more about maximum contribution limits on the HR website.
Ready to Enroll?
You can only enroll in an FSA during the MSU Benefits Open Enrollment period in October each year unless you experience a qualifying life event (death, birth, marriage, divorce, etc.) or you are a newly hired/eligible employee. You have 30 days from your hire date or qualifying life event to enroll in an FSA plan.
Before you enroll, make sure you take some time to understand each plan and estimate how much you are likely to spend on eligible expenses throughout the plan year. Please note: according to IRS requirements, any unused funds left in your account at the end of the plan year will be forfeited, so please plan conservatively. Learn more about FSAs – including contribution limits, deadlines, and eligible expenses – on the HR website.
Marx, B. (2019, May 22). These Maps Show the Average Cost of Child Care in Each State. Retrieved from https://www.fatherly.com/news/maps-average-cost-childcare-us/